Background

Philip Morris International (PMI) is the largest tobacco company in the world (excluding the Chinese National Tobacco Corporation).[1] The company is headquartered in New York in the United States (US), but based operationally in Lausanne, Switzerland.[2] PMI was a subsidiary of the Altria Group Inc until 28 March 2008.[2] According to the Associated Press, Altria decided to separate Philip Morris USA and its international operation in order to "clear the international tobacco business from the legal and regulatory constraints facing its domestic counterpart, Philip Morris USA".[3]

In 2015, PMI and its subsidiaries sold its products in over 180 markets, selling cigarettes, other tobacco products and non-combustible nicotine based products.[2] Its global cigarette brands are Marlboro (the world’s bestselling international brand), Merit, Parliament, Virginian S, L&M, Philip Morris, Bond Street, Chesterfield, Lark, Muratti, Next and Red & White.

The company was also a member of the Eliminating Child Labour in Tobacco Growing Foundation (ECLT).[6] The ECLT has a partnership with the International Labour Organization (ILO), a United Nations (UN) agency, focussed on issues related to labour such as international labour standards, social protection and unemployment.[7]

Ogilvy Group's collaboration with Philip Morris goes back to the 1950s when it ran one of its advertising campaigns.

Controversial Marketing Strategies

Targeting Youth

PMI says that they are “committed to doing our part to help prevent children from smoking or using nicotine products”. [9]

They further state that their “marketing complies with all applicable laws and regulations, and we have robust internal policies and procedures in place so that all our marketing and advertising activities are directed only toward adult smokers”.[9]

Despite these assurances, PMI has been accused of, and fined for, running marketing campaigns that target young people.

In 2014, PMI was fined more than US$ 480,000 in Brazil over its Be Marlboro campaign, which has been strongly criticised for deliberately targeting youth.[10][11] The campaign was first launched in 2011 in Germany to promote PMI’s revamped Marlboro brand, and was rolled out in more than 50 countries. Germany banned the campaign in 2013, reportedly ruling that “[the ads] were designed to encourage children as young as 14 to smoke”.[12]

Images 1 to 5 show examples of the Be Marlboro campaign. All images were taken from a 2012 presentation by the tobacco company’s Senior Vice President of Marketing and Sales, Frederic de Wilde.[13]

Image 2.“…metaphorically, find your way in life and don’t be held back by obstacles”

Image 3.“Trusting the others to share a common emotion is also something ‘Maybe’s’ would not consider”

Image 4.“Reaching the top to live the moment just depends on your decisiveness”

Image 5.“Communicate and take your chances, don’t hesitate it’s up to you”

PMI's controversial practices do not only apply to the marketing of the company's combustible products.Concerns were raised about a proposed marketing strategy that PMI planned to use to launch Parliament snus in Russia in 2012.[14] The proposed advertising materials, made public by advertising firm Proximity Russia, included materials that were clearly titled “advanced youth engagement materials”.[14]

For more information on this campaign, and images of the marketing materials, visit our page on Snus: Marketing to Youth.

Complicity in Tobacco Smuggling

PMI portrays itself publicly as a victim of illicit tobacco trade, with the company reporting that tobacco smuggling results in “loss in sales”, and “damages our brand”.[15]

To help tackle illicit trade, PMI launched a funding initiative called PMI IMPACT, worth US$100m and aimed at bringing together “organisations that fight illegal trade and related crimes, enabling them to implement solutions”.[16] In its first call for proposals in 2016, PMI asked for “projects that have an impact on illegal trade and related crimes in the European Union…”[17]

In contrast to the company’s public persona of being part of the smuggling solution, evidence shows that the company was, in fact, part of the problem. In 2000, the European Commission (backed by a majority of EU member states) started court proceedings in the US Courts against PMI and other tobacco companies for its complicity in tobacco smuggling.The Commission claimed that the tobacco companies “boosted their profits in the past by deliberately oversupplying some countries so that their product could be smuggled into the EU”, costing the EU millions of euros in lost tax and customs revenue.[18][19]

PMI and the Commission settled their dispute in 2004, when the company agreed to pay the Commission £675m to fund anti-smuggling activities.[20] The two Parties signed an Anti-Counterfeit and Anti-Contraband Cooperation Agreement,[21] referred to by the company as Project Star. As part of this agreement, PMI commissioned KPMG to measure annually the size of the legal, contraband and counterfeit markets for tobacco products in each EU Member States.

Project Star’s methodology and data have been strongly criticised for lack of transparency, overestimating illicit cigarette levels in some European countries, and serving PMI's interests over those of the EU and its member states.[22]

Tactics to Subvert Tobacco Control Campaigns and Policies

PMI has strongly opposed tobacco control legislation and regulations across the world, including plain packaging in Australia and the UK, the EU Tobacco Products Directive (TPD), and tobacco control decrees in Uruguay. The company has used a variety of strategies and tactics to influence tobacco control policies, and subvert existing regulations.

Funding Pro-Tobacco Research and Discrediting Independent Evidence

In response to plain packaging proposals in the UK, PMI funded research, expert opinion and public relations activities which supported its position. One of the people that PMI funded for this purpose was Will O’Reilly, a former Detective Chief Inspector with the London Metropolitan Police.

O’Reilly was appointed as a PMI consultant in 2011,[23] conducting undercover test purchases of illicit tobacco and publicising his findings in UK regional press. One of PMI's arguments to oppose plain packaging, was that the public health measure would lead to an increase in illicit tobacco, including counterfeited plain packs. For background on, and a critique of, this argument, go to Countering Industry Arguments Against Plain Packaging: It will Lead to Increased Smuggling. O’Reilly’s test purchases appear to have enabled PMI to secure significant press coverage of its data on illicit tobacco.[24]

Other organisations and individuals that have received funding from PMI to produce research or expert opinions or critiques of independent evidence, in order to oppose tobacco control legislation are:

Using Freedom of Information Requests to Acquire Public Health Research Data

Freedom of Information (FOI) requests are one strategy that the tobacco industry use to undermine tobacco control legislation, often covertly using third parties.[38]

In 2009, and again in 2011, PMI sent Freedom of Information requests to Stirling University (UK) requesting access to a wide range of data from its research on teenage smoking. PMI alleged that it wanted “to understand more about the research project conducted by the University of Stirling on plain packaging for cigarettes”.[39] The FOI requests were eventually dropped.

For more information on these FOI requests, and an explanation on how these requests impacted the University of Stirling, go to our page FOI: Stirling University.

Fabricating Support through Front Groups

PMI has used front groups to oppose tobacco control measures. Front Groups are organisations that purport to serve a public interest, while actually serving the interests of another party (in this case the tobacco industry), and often obscuring the connection between them.

In Australia, leaked private documents revealed that the supposed anti-plain packaging retailer grass roots movement, the Alliance of Australian Retailers was set up by tobacco companies and that the Director of Corporate Affairs Philip Morris Australia, Chris Argent, played a critical role in its day-to-day operations.[40][41][42]

Lobbying of Decision Makers

EU

PMI reported that it spent between €1,250,000 and €1,499,999 in 2015 lobbying EU institutions, employing only 1.5 fulltime equivalent staff in its Brussels office.[43] If this data is correct, it suggests that PMI relied heavily on external lobbying firms.

A 2013 leaked internal PMI document revealed that the company had 161 lobbyists working to undermine the revision of the EU Tobacco Products Directive (TPD).[44] The objective of PMI’s campaign was to either ‘push’ (i.e. amend) or ‘delay’ the TPD proposal, and ‘block’ any so-called ‘extreme policy options’ like the proposed point of sales display ban and plain packaging.[45]

UK

The leaked internal PMI documents also revealed the extent of a multi-faceted campaign against Plain Packaging in the UK, including a detailed media campaign using dozens of third parties (both individuals and organisations) to promote its arguments against the policy. The documents also included a detailed political analysis of potential routes of influence for the tobacco company(Image 6).[23]

One third party appointed in November 2011 to help PMI oppose the plain packaging proposal was the Crosby Textor Group. This appointment led to a conflict of interest scandal given that Lynton Crosby co-Director of the Crosby Textor Group, was also the political election strategist for the UK’s Conservative Party when they were the political party in power in the UK. David Cameron, then head of the Conservative Party and UK Prime Minister, insisted that Crosby never lobbied him about plain packaging. [46][47] Despite a lack of evidence that Crosby lobbied the Prime Minister and Health Minister on plain packaging, documents released under FOI legislation, obtained by the University of Bath Tobacco Control Research Group, show that Crosby lobbied the UK Government on plain packaging via Lord Marland, the then Parliamentary Under Secretary of State for Intellectual Property, to oppose plain packaging. For more information on this lobbying scandal, go to Lynton Crosby’s page.

For more detail on PMI's attempts to undermine plain packaging proposals in the UK, visit

Intimidating Governments with Litigation or Threat of Litigation

PMI has legally challenged tobacco control regulations in the UK, EU, Uruguay and Australia, including:

Ordinance 514, dated 18 August 2008, and Decree 287/009 dated 15 June 2009 (Uruguay). PMI unsuccessfully challenged the Uruguayan Tobacco Control Act which included a mandate for 80% health warnings on tobacco packets.[48] PMI brought its claim under the Switzerland-Uruguay Bilateral Investment Treaty at the World Bank’s International Center for Settlement of Investment Disputes. The tribunal ruled in favour of Uruguay in July 2016.[49]

The Tobacco Plain Packaging Act 2011 (Australia). PMI fiercely opposed this piece of legislation, fearing that it may set a global precedence. The company fought this legislation unsuccessfully on three fronts:

World Trade Organization (WTO) challenge: In 2014, PMI supported a request by the Dominican Republic government before the WTO Dispute Settlement Body, alleging that Australia’s plain packaging laws breach the WTO’s General Agreement on Tariffs and Trade (GATT), Agreement on Technical Barriers to Trade (TBT) and agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).[50] Similar requests were submitted by Ukraine, Cuba, Indonesia and Honduras, and furthermore, a record number of more than 40 WTO members joined the dispute as third parties.[51]

Constitutional challenge: In March 2012, PMI supported a claim made by British American Tobacco (BAT) in Deceber 2011 before the Australian High Court that plain packaging was in breach of the Australian constitution.[52] On 15 August 2012, the Hight Court ruled that plain packaging was not in breach with the Australian constitution as there had been no acquisition of property as alleged by the tobacco companies.[51]

Bilateral Investment challenge: In 2011, PMI started legal proceedings against the Australian government for allegedly violating the terms of The Australia – Hong Kong Bilateral Investment Treaty.[53] In December 2015, The Permanent Court of Arbitration issued a unanimous decision that it had no jurisdiction to hear the claim.

The Standardised Packaging of Tobacco Products Regulations 2015 (UK). Following the passage of the legislation in March 2015, PMI and others launched a legal action, which it lost in May 2016 (the day before the legislation was due to come into force).[54][55]

The 2014 EU Tobacco Products Directive (TPD). PMI and BAT attempted to invalidate the TPD as a whole, or various provisions within it, but this legal challenge was dismissed in the European Court of Justice in May 2016.[56] More details can be found on the page TPD: Legal Challenges.

Next Generation Products

To improve the tobacco industry’s sustainability, tobacco companies are investing in tobacco and nicotine products that, unlike cigarettes, could have growth potential in developed markets. These products are often referred to as Next Generation Products (NGPs), and are often linked to tobacco companies’ harm reduction strategies.
In January 2017, PMI issued a press release which stated that the company intended to move its business away from combustible tobacco products entirely.(Image 7)[57] In April 2019 a life insurance company Reviti was launched. It is a wholly-owned subsidiary of PMI. The London-based company specialises in offering policies to smokers, with discounts for those who reduce or switch to PMI’s Next Generation Products.
For more information on these products go to E-Cigarettes: Philip Morris International and Heated Tobacco Products.

In September 2017, the Foundation for a Smoke-Free World was formally launched at the Global Tobacco and Nicotine Forum 2017, a tobacco-industry funded event.[58][59] The Foundation for a Smoke-Free World describes itself as “an independent, private foundation formed and operated free from the control or influence of any third party”, which “makes grants and supports medical, agricultural, and scientific research to end smoking and its health effects and to address the impact of reduced worldwide demand for tobacco”.[60][61] The Foundation is entirely funded by PMI to the tune of US$1 billion.[60] Derek Yach leads the Foundation and is the former Head of the World Health Organization’s (WHO) Tobacco Free Initiative. He was also Senior Vice President of Global Health and Agriculture Policy at the global sugary drinks giant PepsiCo.[62]

Futuro sin Humo campaign in Mexico

Futuro sin Humo (Smoke-free Future in English) is a Philip Morris International initiative[63] from its Mexico office to promote their line of Next Generation Products. The initiative was launched in 2018, along with the hashtag #futurosinhumo, which translates into "smoke-free future". Its website describes it as a

“movement is to inform and give voice to smokers and their over-18 years old relatives who are interested in the non-combustion alternatives that are now available in many other countries. We are sure that smokeless products are a better choice for smokers and their introduction in Mexico must be preceded by a debate that includes all stakeholders and is based on scientific evidence.”[64]

For more information about the campaign and its use of celebrities, social media marketing and sports events see Futuro sin Humo.

↑ European Commission, Anti-contraband and anti-counterfeit agreement and general release between Philip Morris International, Philip Morris Products, Philip Morris Duty Free, and Philip Morris Trade Sarl, the European Community represented by the European Commission and each Member State listed on the signature pages hereto, 9 July 2004